KiwiRail would allow Hawke's Bay council to lease Napier-Gisborne line

Monday 24th November 2014 1 Comment

Kiwirail, the state-owned railroad, has conditionally agreed to lease the mothballed Napier to Gisborne line to Hawke’s Bay Regional Council, effectively giving the local authority an option to resurrect the unprofitable route.

KiwiRail mothballed the line in December 2012 after storm damage it estimated would have cost $4 million to repair. At the time it said ongoing maintenance costs would have mounted up to a further $6 million a year.

By mothballing the the 212 kilometre Gisborne to Napier line, KiwiRail left open the possibility it could re open in future if it became more economic. The railroad spent up to $4 million to make the line safe while closed, with annual maintenance costs of up to $800,000.

HBRC said it has until March 1, 2015, to respond to KiwiRail's offer and before then it will assess whether the line would make sense as an investment.

Some local businesses have been campaigning to get rail services reinstated.

BusinessDesk.co.nz

Comments from our readers

On 24 November 2014 at 6:18 pm Don said:

Interesting, their business case would need careful scrutiny, as how often have we seen Councils lose money over so called business ventures? Was in Whangarei/Kawakawa last week, saw almost continuous logging trucks going through Whangarei.Felt how much better to use rail, as Northland roads were suffering badly, and a rail line exists.